Universal credit will make closing disadvantage gaps harder

By Jenna Julius, NFER Research Director

Monday 13 March 2023

This blog post was first published in Schools Week on Friday 10th March 2023.

There is a large and long-standing gap in education outcomes between pupils from economically disadvantaged backgrounds and their peers in England. As schools continue to grapple with the impacts of the cost-of-living crisis, it’s vital that there are well-targeted and effective strategies to help close this gap.  

However, an unintended consequence of the government’s roll-out of Universal Credit (UC) means that it will become almost impossible to understand how the performance of disadvantaged pupils is evolving over the next decade. 

Transitional arrangements 

Following the introduction of UC in April 2018, all pupils whose families are in receipt of this benefit with household income less than £7,400 are eligible for free school meals (FSM). This is alongside pupils who meet the eligibility requirements for FSM as part of a number of legacy schemes.  

At the same time, the government introduced some temporary transitional arrangements in order to smooth out the roll-out of UC. These arrangements protect the FSM eligibility status of pupils, regardless of whether their family circumstances improve (e.g., their household income increases above the FSM threshold or they cease to be eligible for UC).  

These UC transitional arrangements have contributed to large recent increases in the number of pupils who are eligible for FSM, and all else being equal this upward trend is expected to continue until at least the end of the current decade. This is in spite of the fact that the household income threshold for becoming FSM-eligible has not increased since 2018 even though there has been significant wage inflation, which means the criteria for becoming newly eligible for FSM have been getting increasingly stringent. 

Having said that, it is important to note that increases in FSM eligibility are largely among pupils who may already have been considered in need of additional support.  

Implications for the attainment gap 

Our NFER research published last year highlighted that the transitional arrangements will effectively change the definition of disadvantage each year from 2024 onwards. This will make it increasingly difficult to assess the government’s progress in reducing disadvantaged pupils’ attainment gap, because we will no longer be comparing like with like. It will become increasingly hard to tell whether observed changes are being driven by the changing composition of the disadvantaged group, economic conditions or changes in the relative attainment of disadvantaged and non-disadvantaged pupils. 

This has been further exacerbated by the fact that in January the government extended the transitional arrangements for a further two years, to finish in March 2025. This will mean that the measurement of the disadvantaged attainment gap will be impacted until at least 2036.  

What can be done? 

Today, NFER has published new insights from a roundtable with experts involved in policy and research on disadvantage and education. The event was held specifically to discuss the implications of the UC roll-out on the disadvantage gap and explore the best ways forward.  

The paper outlines a number of potential policy solutions, including that the government explore the feasibility of establishing a household income-based measure of disadvantage for the future. This would not only enable the construction of a comparable disadvantage gap measure over time, but it would also provide the basis to achieve a greater understanding of the relationship between the extent of economic disadvantage and pupil outcomes. This is not possible using the existing binary FSM eligibility measure, and was a key recommendation from our recent research for the Social Mobility Commission. 

If the government takes no action to address this issue, the current disadvantaged gap measure will be seriously undermined and unfit for purpose. This would leave the wholly unsatisfactory situation of having no credible national metric for monitoring progress in closing the disadvantage attainment gap for the next decade or more, just as the cost-of-living crisis looks set to multiply the number of disadvantaged children.  

Action is needed now to avoid this and ensure that long-standing gaps between disadvantaged pupils and their peers are being adequately addressed.